AASB S2 Implementation Advisory Panel Submissions Log

How can preparers and auditors assess which emission factors best represent the entity's activity as a basis for measuring its greenhouse gas (GHG) emissions?

The emission factors an entity uses to measure its greenhouse gas emissions are specific to its circumstances. AASB S2 does not prescribe specific emission factors but requires entities to use those that best reflect their activities and to disclose the emissions factors used as part of explaining their measurement approach, inputs and assumptions (paragraph B29).

Stakeholders may find it useful to consider non-authoritative supporting materials available on the AASB S2 Knowledge Hub. These include:

• AASB educational material about the requirements in AASB S2 related to the measurement and disclosure of GHG emissions
  Available here
• A link to the publicly available National Greenhouse Accounts (NGA) Factors, updated and published annually by the Department of Climate Change, Energy, the Environment and Water
  Available here
• FAQ: How should an entity determine which emission factors best represent the entity's activities as a basis for measuring its GHG emissions?
  Available here

How does an entity that has obligations to report under NGER apply the jurisdictional relief in AASB S2.29(a)(ii)? For example, what should the entity do if it has Scope 1 emissions within its organisational boundary that aren't required to be measured under the NGER Measurement Determination? How should the entity apply the relief if it only needs to report at the facility level? What if the entity has a financial year-end that isn't June 30—how does that affect applying the relief?

The organisational boundary affects which operations' direct GHG emissions are included in the measurement of a reporting entity's Scope 1 GHG emissions, and how GHG emissions of the reporting entity are classified between scopes.

AASB S2 permits an entity to use a GHG emissions measurement method other than the GHG Protocol if required by a jurisdictional authority or exchange, for as long as that requirement remains applicable (paragraph B24). This jurisdictional relief is intended to avoid duplicative reporting where an entity would otherwise need to apply both the GHG Protocol and another GHG emissions measurement method (paragraph BC88 of IFRS S2).

AASB S2025-1 Amendments to Greenhouse Gas Emissions Disclosures made targeted amendments to AASB S2 to clarify that the jurisdictional relief may be applied when an entity is required, in whole or in part, by a jurisdictional authority or exchange to use a GHG emissions measurement method other than the GHG Protocol. These amendments respond to application challenges identified by stakeholders globally and aim to help clarify the jurisdictional relief.

Stakeholders may find it useful to consider non-authoritative supporting materials available on the AASB S2 Knowledge Hub. These include:

• AASB educational material about the requirements in AASB S2 related to the measurement and disclosure of GHG emissions
  Available here
• A CSIRO document that provides a high-level comparison of key differences between the two Greenhouse Gas Protocol Standards applied in the context of AASB S2 and the NGER Scheme
  Available here
• FAQ: Is there jurisdictional relief available for the determination of which GHG emissions are included in the measurement of a reporting entity's emissions?
  Available here

Would a low emissions scenario of SSP1-2.6/RCP2.6 meet the requirements in the Corporations Act 2001 (Cth)?

Would a low emissions scenario of SSP1-2.6/RCP2.6 meet the requirements in the Corporations Act 2001 (Cth) and must the low emissions scenario be applied to both physical and transition risks?

These questions relate to requirements in the Corporations Act 2001 (Cth) and are therefore outside the remit of the IAP.

Stakeholders may find it useful to consider the following FAQ available on the AASB S2 Knowledge Hub
FAQ: What scenarios do I need to use when conducting climate-related scenario analysis under AASB S2?
Available here

Does AASB S2 require disclosures relating to Repurchasing Agreements, Reverse-Repurchasing Agreements and Options Contracts if information about these financial products is not material?

AASB S2 requires an entity to provide information to enable users of general purpose financial reports to understand the effects of climate-related risks and opportunities on the entity's prospects, if it is material. This is the case even if that information is not specified by AASB S2. Conversely, an entity need not disclose information that is required by AASB S2 if that information is not material (paragraphs B25—B26 in Appendix D).

Stakeholders may find it useful to consider non-authoritative supporting materials available on the AASB S2 Knowledge Hub. These include:

• AASB S2 educational material about climate-related risks and opportunities, and the disclosure of material information
  Available here
• FAQ: How does AASB S2 approach materiality?
  Available here

How should information about Power Purchase Agreements (PPAs) that are matched with Large-scale Generation Certificates (LGCs) be considered under AASB S2?

The relevance of PPAs and LGCs to the requirements in AASB S2 will depend on an entity's facts and circumstances.

Stakeholders may find it helpful to consider the requirements in AASB S2 related to the disclosure of location-based Scope 2 greenhouse gas (GHG) emissions and the need to provide information about any contractual instruments that inform users' understanding of those GHG emissions (paragraph B29(a)(v)). Stakeholders may also find it helpful to consider requirements related to climate-related targets (paragraphs 33—36 and B30—B31).

Are the baselines defined under the NGER Safeguard Mechanism "targets an entity is required to meet by law or regulation" in the context of AASB S2?

The objective of metrics and targets in AASB S2 is to help users of general purpose financial reports understand how an entity is performing in relation to its climate-related risks and opportunities. This includes understanding the entity's progress towards any climate-related targets it has set, as well as any targets it is required to meet by law or regulation (paragraph 27).

Climate-related targets refer to any quantitative and qualitative targets that respond to climate-related risks or opportunities. Greenhouse gas emissions targets are one kind of climate-related target, which may help to provide users with information about the timing and pathway of the entity's plans to reduce its emissions in anticipation of a lower-carbon economy (paragraph BC 51 of IFRS S2).

Stakeholders may find it useful to consider the following FAQ available on the AASB S2 Knowledge Hub:
FAQ: What are climate-related targets under AASB S2?
Available here